Directions for Digital Financial Layout: New Trends in Digital Transformation of the Banking Industry

Directions for Digital Financial Layout: New Trends in Digital Transformation of the Banking IndustryThe 6th China Fintech Forum, held in Beijing Shougang Park as a special forum of the 2024 China International Fair for Trade in Services (CIFTIS), attracted many banking professionals to discuss the development trends of digital finance under the theme of "Technological Empowerment - Digital Transformation and Application of the Financial Industry."Digital Finance: The Driving Force for Transformation of the Financial IndustryXing Wei, Party Secretary of the China Banking Association, pointed out at the forum that driven by digital technologies such as big data, blockchain, and artificial intelligence, the financial industry is undergoing an unprecedented transformation

Directions for Digital Financial Layout: New Trends in Digital Transformation of the Banking Industry

The 6th China Fintech Forum, held in Beijing Shougang Park as a special forum of the 2024 China International Fair for Trade in Services (CIFTIS), attracted many banking professionals to discuss the development trends of digital finance under the theme of "Technological Empowerment - Digital Transformation and Application of the Financial Industry."

Digital Finance: The Driving Force for Transformation of the Financial Industry

Xing Wei, Party Secretary of the China Banking Association, pointed out at the forum that driven by digital technologies such as big data, blockchain, and artificial intelligence, the financial industry is undergoing an unprecedented transformation. The banking industry, using digital finance as a lever, is actively meeting the diverse operating needs of enterprises, continuously improving core competitiveness, core technical capabilities, and enhancing the targeting and effectiveness of financial services.

Many experts agree that digital finance plays a significant "driving" role, not only as one of the five articles of finance but also playing a crucial role in promoting other financial fields such as tech fin, green finance, inclusive finance, and pension finance.

Digital Transformation Practices in the Banking Industry: Accelerating the Formation of New Quality Productivity

Meng Qian, Chief Information Officer of Bank of China, stated that digital finance, based on new-generation digital technologies and using data as a new type of production factor, will become a significant engine for accelerating the formation of new quality productivity. To this end, Bank of China has formulated a digital finance action plan, established a digital finance committee, and set up digitalization-related teams in business lines at all levels.

Bank of China has built multiple new technology promotion and application platforms, applying them in multiple business scenarios such as customer information, human resources, and financial management, achieving cost reduction, efficiency improvement, and quality enhancement. Meanwhile, through the establishment of a "dictionary" of unified data for the entire group, a unified standard within the group is implemented, effectively supporting precise marketing, risk control, operational optimization, and management.

L Zhongtao, Chief Technology Officer of Industrial and Commercial Bank of China, believes that digital finance has broken through the limitations of time and space for financial services, improved resource allocation efficiency, and lowered financial service costs, which is of great importance for building strong financial institutions. In recent years, ICBC has adhered to digital development, initiated IT architecture transformation, comprehensively implemented the construction project of a smart banking ecosystem, and entered the "Digitalization 2.0" stage led by digital technology.

ICBC has built an independently controllable AI large model technology system, comprehensively promoting the innovative application of AI large model technology in major business areas like remote banking, branch operations, financial markets, and credit management.

Digital Transformation: Digital Technology, Data Elements, and Business Scenarios are Indispensable

Gao Feng, Chief Information Officer of the China Banking Association, emphasized that digital transformation requires the combined role of digital technology, data elements, and business scenarios, none of which can be omitted. The essence of digital transformation is to activate data elements through cutting-edge digital technologies to empower traditional business models.

Chen Chong, Dean of the Financial Technology Research Institute of Industrial Bank, introduced Industrial Bank's digital transformation practices in empowering inclusive finance and green finance. Industrial Bank innovatively established a "biological asset digital supervision platform," injecting digital new vitality into inclusive finance and improving the quality and efficiency of services for rural revitalization. Through putting electronic ear tags on the cattle, sheep, and other livestock of farmers, the monitoring platform leverages "IoT + blockchain + AI" technology to realize intelligent inventory of different livestock breeds and farming scenarios, utilizing digital means to empower bank post-loan management. This enables live biological assets to become collateral, solving the financing difficulties of farmers.

Data: A Key Element of Digital Finance

In the innovative digital platforms created by various banks, the importance of data is increasingly prominent. Wang Yi, Director of the Science and Technology and Product Management Bureau of Agricultural Bank of China, pointed out that under the impetus of AI large models, artificial intelligence is starting to shift towards data-centric, making high-quality data supply particularly important.

The next step for Agricultural Bank of China will be to enhance data quality from the perspective of adapting to AI applications, further enriching the types of data collected, improving data quality, and building a model and data security protection system. Agricultural Bank of China will adhere to innovation-driven development, build a new "data + algorithm"-driven management model, comprehensively promote the construction of smart banking, and achieve more accurate customer insights and more efficient operational management.

Talent Cultivation, Joint Innovation, and Risk Control: Important Guarantees for Digital Transformation

Experts point out that financial institutions should cultivate more composite talents who understand both business and technology, possessing comprehensive capabilities including business skills, a global perspective, digitalization concepts, and technologies. At the same time, financial institutions should strengthen joint innovation with leading scientific research institutions and enterprises, accelerating research and innovative applications of digital transformation. Moreover, financial institutions should pay attention to risks arising from innovation, continuously improving the risk control capabilities of digital finance.

Conclusion

Digital finance is a necessary measure for the banking industry to achieve high-quality development in line with the development of the digital economy, as well as a way for commercial banks to break through the bottleneck in a low-interest rate market environment. With the continuous development and application of digital technology, the banking industry will continue to deepen digital transformation, build a more open, efficient, and convenient financial service system, and provide stronger support for economic and social development.